Morning business news - January 8Wednesday 08 January 2014 10.35
The value of Irish food and drinks exports grew by over 9% in 2013 bringing the total value close to just under €10 billion for the year. Bord Bia's chief executive Aidan Cotter said that the key driver of growth in 2013 was dairy, which accounted for more than half the growth. That was followed by meat and prepared meals - both sectors recorded double digit growth in the year.
The UK market was the biggest destination for food and beverage exports in 2013. "The UK market is one with very strong positions built up. The prospect of economic recovery there is looking even greater now. Long term, it's a market that looks set for expansion given the population forecasts of 10 million extra consumers in the next few years," commented Mr Cotter.
In Europe, Germany, France and the Netherlands were the strongest markets for Irish exports, but the star performer of the industry worldwide was China. "We trebled our exports to China in the past few years. It's now our sixth largest market overall. It's the second biggest dairy market where there are massive growth prospects. It is conceivable that it could become our second biggest food and drink export destination in the next few years," the Bord Bia CEO said.
Mr Cotter said that the Asian market was limited to processed products mainly as it takes 42 days to ship food products there. Much of the dairy that we export there is in the form of infant formula and other powdered products. However, the group is very bullish about prospects in Asia in general with more emerging markets in their sights in the region. "There's a huge growing middle class in that region with up to 150 million people joining the ranks of the middle classes every year. This is the last year of the dairy quotas so everyone will be looking forward to strong positions after 2015 to ensure that growth in dairy can be accommodated in new markets, especially in Asia," Mr Cotter concluded.
MORNING BRIEFS - The US Federal Reserve releases the minutes of its December meeting today. There will be much interest in what was discussed given that this was the meeting at which the Fed decided to cut back its stimulus programme from $85 billion of monthly bond purchases to $75 billion. Investors will be looking for clues about how the Fed intends to further wind down stimulus. Recent data, including last week's factory activity report, confirmed underlying strength in the economy, suggesting the Fed was justified in its move. But investors will be keenly watching Friday's jobs report for signs of activity there.
*** The Irish Times is reporting that the NTMA has decided to go for the median point for the amount of money it intends to raise on the international debt markets this year. It had pencilled in a range of €6-10 billion, but now it is going for €8 billion for 2014. The year got off to a very good start indeed yesterday, with the NTMA pulling in €3.75 billion on a ten year bond at an interest rate of just over 3.5%. The agency got offers of up to €14 billion for the bond..
*** Microsoft is reported to be close to naming a new chief executive, but it is not going to be the head of the Ford Motor Company, Alan Mulally, who had been seen as a frontrunner. He has pulled out of the race. Microsoft said last month it expects to appoint a new CEO early this year. It has been seeking a replacement for Steve Ballmer since the long-time CEO in August announced his plan to retire. Remaining candidates on the shortlist include former Microsoft boss Stephen Elop.
*** There was a continued decline in the rate of housing construction activity in 2013, but the rate of decline appears to be slowing. That is according to the National Housing Construction Index compiled by Link2Plans. Nationally there was a fall in both planning applications, which registered a 5% decrease, and project commencements, which were down 7%. However, six counties registered an increase in applications in the year - mostly in the east of the country around Dublin.